For Digital Financial Business
Mirae Asset Daewoo and Naver agreed to exchange equities amounting to a total of 1 trillion won (US$900 million) with 500 billion won each in order to promote digital financial businesses at home and abroad. The two companies will take on a new challenge by establishing an alliance for the fourth industrial revolution, which goes forward with joint research on the artificial intelligence (AI)-related financial sector, and jointly discovers and invests in advanced startup companies at home and abroad.
On the day, Mirae Asset Daewoo and Naver announced measures for strategic alliance for the joint project. It is forecast that this partnership will intensively promote the activities of the New Growth Investment Cooperative between the Mirae Asset Group and Naver launched in December of last year.
According to the agreement, Mirae Asset Daewoo will purchase 563,063 shares of Naver (a 1.71% stake) and Naver do 37,393,3644 shares of Mirae Asset Daewoo (a 7.11% stake). They will purchase them for the closing price on June 26 in block deals before the opening bell in the stock market on June 27.
Naver, the largest internet portal in Korea decided to buy 500 billion won (US$450 million) worth of Mirae Asset Daewoo treasury shares on June 26 to introduce completely new services by adding financial content elements to the technology-based business. Moreover, based on this, the company plans to expand beyond the Korean market and further accelerate its advancement into the global market. As Naver announced that the company will be reborn as a technology platform company by simply breaking away from being a search portal site, Naver obtained a wing, Mirae Asset Daewoo, the No. 1 securities company in Korea.
In addition, this collaboration decision will strengthen Naver's financial and economic contents for those who use search service. In the past, Naver’s financial services were only able to display information such as stock prices and exchange rates. But in the future, Naver will be able to provide users with specific investment contents.
In addition, Mirae Asset Daewoo may launch “Robo Advisor (RA)” products by making good use of Naver's AI and big data technology. RoboAdviser is a strategy which manages investors' assets based on algorithms and is characterized by minimized human intervention.
Another positive synergy effect that Naver expects from its alliance with Mirae Asset Daewoo is its global business. The Mirae Asset Group including Mirae Asset Daewoo has overseas subsidiaries in nine countries, including those in North and South America, Europe and Southeast Asia and China. Lee Hae-jin, founder and a former chairman of Naver's board of directors, has strong will to secure new growth engines by finding start-ups overseas. Lee voluntarily resigned as chairman of the board of directors in March, saying that he will discover hidden promising start-ups in Europe.
Lee’s decision is based on a strategy that as Google is dominating in North and South America and Asia, he will find a game changer in Europe where “'anti-Google” sentiments are strong. Korean search giant Naver is expected to generate synergy effects with Mirae Asset Daewoo as its business is already rooted in China, Japan and Southeast Asia via the mobile messenger line business.